One third of brands are considering change of agency in the next six months: Study

Nearly one-third of U.S. brands may be contemplating switching up their ad agency in the next six months, while more than nine in 10 say chemistry is the most important factor in forging a new agency partnership, according to a newly released study from Atlanta-based “marketing matchmaker” firm Setup. The company’s third annual Marketing Relationship Survey, published today, sought insight from more than 300 marketers across major brands and agencies, with the majority of respondents in each group identifying as C-suite or other top-level employees. Survey participants hail from a diverse range of brands, including IBM, WarnerMedia, Duracell, Bojangles and Hunter Boot, while agency respondents include executives and staff from Morrison, Modo Modo, Publicis Groupe’s Razorfish and more. The 2021 study’s most surprising finding is that 30% of brand marketers say they are at least somewhat likely to switch agencies within the next six months, capping what may be the end of a tumultuous era for many agency-client relationships. (Setup’s 2020 Marketing Relationship Study, which was published prior to the global outbreak of COVID-19, found a similar number of brands planned to “review their agency partners in the next three months.”) “We have shortened our planning cycles to pivot rapidly to adjust to dynamic conditions. With that, we also have continued to reevaluate our agency partnerships to ensure we remain nimble,” says Katie Kirschner, VP of brand, content and digital marketing at point-of-sale software company NCR. Meeting customer demands is “made possible by working with dependable agency partners,” she adds. Perhaps contributing to the instability of some agency-brand relationships is a lack of transparency and communication; both parties agree that being clear with each other is paramount, according to the survey, which found 65% of brand-side and 56% of agency-side marketers want to improve communication in their professional relationships. Setup’s report also found that assigning fault and measuring expectations can be a he-said-she-said affair, with 13% of brands saying they’d like to see “more value” from their agencies for less money, while 12% of agencies say brand asks often exceed set budgets. “It’s essential to form genuine partnerships with clients,” says David Mullen, president of award-winning small agency The Variable. “This means building a strong foundation based on mutual understanding, goodwill and open lines of communication. Our agency remains successful because we prioritize transparency to ensure we exceed expectations and accomplish outstanding results for our clients.” Foundational to any strong agency-client deal is mutual chemistry, according to Setup’s survey, with 90% of agencies and 92% of brands ranking it as the most important factor in building a creative relationship. Chemistry edged out other high-ranking considerations including understanding of the industry, professionalism and general creativity to land the top spot—up significantly from 2020, when the Marketing Relationship Survey found chemistry was ranked fourth most important overall. Secondary considerations such as agency size, location and seniority of staff were reported as some of the least important factors by survey respondents. Setup’s report also found brand marketers are planning to boost their ad spend by at least 50% across five categories: content marketing, video, digital media, websites and user experiences, and influencers and social media. The survey notes the boom digital advertising saw amid the COVID-19 pandemic and theorizes that creative shops who emphasize their digital capabilities may have a leg-up in the post-virus recovery phase. “Agencies who do specialize or offer digital services are poised to be in a heightened position to survive and thrive post-COVID compared to those who don’t work in the digital space,” it reads.

One third of brands are considering change of agency in the next six months: Study

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